Monday, February 20, 2017

Catastrophe of bank interest rates - 2

Continued from previous post -
Before we go into the details of this problem, let us first look to the history of modern economic science. It all began when Sir Adam Smith wrote his revolutionary treatise on science of economics. The Wealth of nations was that book. David Ricardo and Karl Marx added to that exposition of this vital subject. After this first generation of economists came second generation of economists lead by John Maynard Keynes and Milton Friedman and many more in the twentieth century. First generation economists were exposing that aspect of economy, which concerned ordinary men and hard work. By that, economic growth was slow and natural. This was not enough for the economists of next generation of Kaynard and Milton Friedman. They wanted to make money fast and without mush efforts. Obviously, that led this generation of economists to indulge in gambling. The stock market that was investment market during first generation of economists was gradually converted in gambling market. Adam Smith and his followers espoused what is economics according to the rules of nature such as demand and supply. The earning capacity in this was slow and for those greedy this was not enough. Therefore, under Kaynard and his followers introduced something that was away from natural economics. They introduced various theories based on so-called market research findings and came up with many notions those encouraged forward trading, speculations and gambling tendencies amongst market people. We consider Adam Smith's school of economics as natural economics and that introduced by Kaynard and others as gambling economics. There were many advantages in gambler economics such as if properly played player can make quick money and grow rich overnight. That was not possible in natural economics of Adam Smith. Without much effort, they wanted to make a lot of money by playing in markets by speculative investments, forward trading et cetera. Human nature that espouses greed and desire for money without efforts helped it grow and natural economics was sidetracked.

India had been practicing Adam Smith's school of economics since early times. Until First World War, most countries were also controlled by this school of economics. However, due to economic crunch that followed the War many smart people including Kaynard and more in his line began to advocate for gambling as mainstream practice. Somehow, nations were convinced of the need for it and all, important countries such as USA accepted it as their mainstream economic practice. India nevertheless, continued to stick to Adam Smith School of economics until 1990. However, due to pressure from gambling lobbies from USA we began to mould our economic practices according to that artificial economy suggested and enforced by economists from Kaynard and his type of economists. Today whole world is suffering due to this wrong practice. USA has been in turmoil ever since they accepted it but the pressure group of gambler economists continues to force USA and most other countries to follow it. Principle disadvantages are gap in rich and poor keeps growing, much money remains in hands of a handful people and most commoners are left with no money. Due to continuous fallout of depressions and inflations in markets, purchasing power of currency keeps on falling, gold control was removed, Dollar became main currency, introduction of FOREX, and gamblers have hay time at FOREX where they can manipulate with values of many currencies and continue to hold countries by artificially reducing its value at FOREX. Demand and supply is no more the ruling principle in market. Playing with interest rates of depositors and borrowers has been one of the most crucial strategies of these gambler economists. To make things easy they skillfully sidetracked GDS and made only GDP as an important ratio.
Continues in next post.

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